We are not in a full-scale war. We are not in a recession or fighting a high unemployment rate. But the federal government is spending as if we were a teenager with a parent’s credit card. Trillion-dollar deficits are coming back soon, so this is the perfect moment to start talking about government austerity.
According to the Congressional Budget Office, even before taking under consideration the budget impact of the Tax Cuts and Jobs Act and the added spending from the budget deals, we are about three years away from the next $1 trillion deficit. Also, this year, the Department of the Treasury will inevitably have to borrow hundreds of billions of dollars to pile on top of our already eye-popping $20.6 trillion of gross debt, which is public debt plus the debt the federal government owes to other accounts, such as Social Security. That’s over 100 percent of our gross domestic product. It will also have to request yet another increase to its borrowing limit, writes Veronique de Rugy.
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